Your company faces various challenges – many of them tend to be related to business financing. The challenges can be positive and some may lay serious threats to the growth of your business or even existence. How can the asset base end to the financing of your business by allowing you to generate working capital and cash flow you need to prosper and grow, even less survive?
Funded asset-based helps your business at the right time and at difficult times. The reality is that most corporate owners and financial managers in Canada do not currently think we are in “good times” and that business funding continues to be a major challenge.
Asset-based finance is under a variety of forms – it is usually in the industry itself called funding “ABL” and that your business would negotiate what is simply or commonly called asset-based credit line . The property provides you with a renewable line of credit very similar to that of an authorized bank – it may also include an important inventory financing element, and usually add up what we could better call special needs or special situations : the reversals, growth, distress, etc. .
The best candidate for a financial credit line based on assets is a company that is experiencing strong growth, but can not attract the traditional capital used to finance receivables, stocks, facilities and equipment, and even in some cases real estate .
A asset-based credit line can best be described as a “creative” financing solution – that is, because it takes your assessment and the “max” finance desired according to your different asset components. In some cases, even intellectual property or patents could be included in overall funding, although this is clearly not the norm.
Pricing in Canada on asset-based credit lines is mainly on the map – we say to customers that they can expect to pay anywhere nearly a point or point greater than 1, 5 to 2% understood per month. Which defines this huge difference in pricing is what our customers always ask. The answer is that the answer is different from what we will call “levels” in the abl loans in Canada, and the overall quality and quality of your business will ultimately take you to a financial partner based on assets that match more to your needs and your set. “Risk Profile”.
The reality is that asset-based funding has changed somewhat the overall face funding in Canada and more and more businesses, both great and small severity of this form of funding. The transaction sizes in Canada vary considerably – we do not encourage customers who have less than 250K / MB should explore asset-based financing because at some point, reports, costs, etc., n. affections your company or the Lender ABL.
Loan margins based on assets Your assets to the extension of their current market value. Stock Funding is a major element of your institution if you need it, and inventory financing in Canada, traditional sources, is difficult to organize.
Are there any disadvantages in asset-based loans and an ABL working capital facility? Our customers ask. With a relative certainty, it can be said that any disadvantage is considerably compensated by the rise. The property gives you almost unlimited working capital and margin assets that may otherwise be funded. And do not forget, this type of installation does not add debt to your balance sheet, you simply monetize your hard and in some cases soft assets.